China’s Payment Apps Give U.S. Bankers Nightmares • Hacker News Board

Re: China’s Payment Apps Give U.S. Bankers Nightmares

#61

Post by abakker » Wed, May 23, 2018, 5:59 PM UTC

s73v3r_ wrote: post #57

chatmasta wrote: post #32

The critical difference is that in China, the apps effectively are the banks, whereas in the US, regulatory capture ensures that the banks stay the banks and it's the app's problem to figure out how to interface with them. The reason the banks are scared is not because "banks" are not involved. They're scared because these apps have successfully vertically integrated to become banks. This is the logical next step for…

"The critical difference is that in China, the apps effectively are the banks, whereas in the US, regulatory capture ensures that the banks stay the banks and it's the app's problem to figure out how to interface with them." Are you sure it's that? Or is it that the apps don't want to have the responsibility of safeguarding people's money? Cause really, payments and money are things where you really do not want to "m…

This all depends whether you can shift the risk. It is fine to break things if you have managed to get insurance to cover the downside.

Re: China’s Payment Apps Give U.S. Bankers Nightmares

#62

Post by xstartup » Wed, May 23, 2018, 6:08 PM UTC

If money has to flow in the economy through limited hubs then hubs automatically grow rich.

It should be a fundamental right in the capitalist country, right to process payment for any party. Today, we need special license/approval for this which limits the "access to disrupt" to few lucky people who have a connection in the big banks. Startups like stripe have to give away a chunk of their equity to old guards at big banks in return of access to a market.

Is this the best a capitalist country may offer?

Re: China’s Payment Apps Give U.S. Bankers Nightmares

#63

Post by gruez » Wed, May 23, 2018, 6:09 PM UTC

tluyben2 wrote: post #30

gruez wrote: post #7

>Western bankers and credit-card executives who travel to China keep returning with the same anxiety: Payments can happen cheaply and easily without them. but there are plenty of "bank -> wallet -> merchant" services in US as well. most notably paypal: you deposit money to your paypal wallet, and spend that money at various online merchants, no credit cards involved.

The anxiety probably stems from the scale of wechat pay; you can pay basically everywhere with it now. Even in places that do not officially accept it, the store clerk will usually just accept on his private phone and put money in the till for you.

how's that any different than payment processors like square, which allows just anyone with a cellphone onto their platform?

>the store clerk will usually just accept on his private phone and put money in the till for you

is that really a thing people do? the risk-reward ratio is all off. you take on the risk of possibly getting a chargeback (maybe the phone/account was stolen), in exchange for... nothing? it's not like the cashier is getting paid commissions.

Re: China’s Payment Apps Give U.S. Bankers Nightmares

#64

Post by forgottenpass » Wed, May 23, 2018, 6:10 PM UTC

chatmasta wrote: post #32

The critical difference is that in China, the apps effectively are the banks, whereas in the US, regulatory capture ensures that the banks stay the banks and it's the app's problem to figure out how to interface with them. The reason the banks are scared is not because "banks" are not involved. They're scared because these apps have successfully vertically integrated to become banks. This is the logical next step for…

>This is the logical next step for Apple / Google Pay and I'm sure it has consumer banks shaking in their boots, because there's no way they can outcompete those companies in tech.

Google and Apple don't have to (and the banks won't get to) compete on tech if they enter the space. They'll compete on their ability to vertically integrate. Good news for google and apple, they're already in every pocket.

Re: China’s Payment Apps Give U.S. Bankers Nightmares

#65

Post by JTbane » Wed, May 23, 2018, 6:12 PM UTC

mixmastamyk wrote: post #13

kevin_b_er wrote: post #6

The banks have been pushing for a cashless society for awhile now. So once they achieve their goal of preventing me from paying someone else $10 without a 3rd party getting a 2-3% fee for the privilege of exchanging money between two private parties, it won't be them getting the 2-3%? Cry me a river.

Hmm, most other countries have free transfers between bank accounts. It's just the US (maybe a few others) still stuck in the stone age.

It still vexes me that I can't instantly transfer money from my bank to a friend's account without paying, or using a third-party like Venmo or Paypal.

Re: China’s Payment Apps Give U.S. Bankers Nightmares

#66

Post by em500 » Wed, May 23, 2018, 6:18 PM UTC

gruez wrote: post #7

>Western bankers and credit-card executives who travel to China keep returning with the same anxiety: Payments can happen cheaply and easily without them. but there are plenty of "bank -> wallet -> merchant" services in US as well. most notably paypal: you deposit money to your paypal wallet, and spend that money at various online merchants, no credit cards involved.

In China you can spend Alipay/WeChat at offline as well as online merchants. And not just larger merchants but also at micro-businesses like mobile food stalls and hole in the wall eateries. Because both the equipment and fees for the merchant are much cheaper than those required for traditional credit/debit card processing.

Re: China’s Payment Apps Give U.S. Bankers Nightmares

#67

Post by cat199 » Wed, May 23, 2018, 6:20 PM UTC

s_dev wrote: post #23

kevin_b_er wrote: post #6

The banks have been pushing for a cashless society for awhile now. So once they achieve their goal of preventing me from paying someone else $10 without a 3rd party getting a 2-3% fee for the privilege of exchanging money between two private parties, it won't be them getting the 2-3%? Cry me a river.

>The banks have been pushing for a cashless society for awhile now. Since the first loan was regulated banks have been pushing for a cashless society. Your comment is very much an understatement. It is the holy grail of the financial industry. Because of the liquidity ratio. Banks are supposed to have 10% of their total lending in cash. This is to prevent a run on the bank. No cash means banks can lend an infinite am…

To all the downvoters of this persons comment quibbling about the word 'cash' - please focus on the general concept of 'how can you have a bank run without a commodity store of value outside of the bank account itself' please...

Re: China’s Payment Apps Give U.S. Bankers Nightmares

#68

Post by em500 » Wed, May 23, 2018, 6:23 PM UTC

gruez wrote: post #63

tluyben2 wrote: post #30

Earlier quoted context omitted.

The anxiety probably stems from the scale of wechat pay; you can pay basically everywhere with it now. Even in places that do not officially accept it, the store clerk will usually just accept on his private phone and put money in the till for you.

how's that any different than payment processors like square, which allows just anyone with a cellphone onto their platform? >the store clerk will usually just accept on his private phone and put money in the till for you is that really a thing people do? the risk-reward ratio is all off. you take on the risk of possibly getting a chargeback (maybe the phone/account was stolen), in exchange for... nothing? it's not l…

Alipay and WeChat pay don't do chargeback, so where's the risk to the clerk? They're mainly replacing cash / direct debit, which don't provide chargeback either.

Re: China’s Payment Apps Give U.S. Bankers Nightmares

#69

Post by tluyben2 » Wed, May 23, 2018, 6:35 PM UTC

gruez wrote: post #40

tluyben2 wrote: post #31

Earlier quoted context omitted.

While there is no guarantee by law, these companies do cover fraud with their vast reserves. Ofcourse an economic downturn could change that.

I'd rather have fraud protection mandated by law, than provided as a good will gesture by the corporation. should there be a disagreement between me and the company, the former provides me with legal recourse, whereas the best I can hope for with the latter is a social media shitstorm.

Ofcourse, just saying how it is and that it is pretty well accepted by 100s of millions of people.

Re: China’s Payment Apps Give U.S. Bankers Nightmares

#70

Post by tluyben2 » Wed, May 23, 2018, 6:48 PM UTC

gruez wrote: post #63

tluyben2 wrote: post #30

Earlier quoted context omitted.

The anxiety probably stems from the scale of wechat pay; you can pay basically everywhere with it now. Even in places that do not officially accept it, the store clerk will usually just accept on his private phone and put money in the till for you.

how's that any different than payment processors like square, which allows just anyone with a cellphone onto their platform? >the store clerk will usually just accept on his private phone and put money in the till for you is that really a thing people do? the risk-reward ratio is all off. you take on the risk of possibly getting a chargeback (maybe the phone/account was stolen), in exchange for... nothing? it's not l…

Slightly offtopic; how easy is it to do chargebacks over there as it sounds trivially easy? On my dutch and spanish creditcards I have tried chargebacks but it is a royal pain in the ass; writing letters (in the actual post, not digitally) and providing proof for obvious things like hotel double charge.